Dear BP: Please Don't Make Us Go Through This Again

Just what you've been looking forward to: the opportunity to relive the horrible summer of 2010.

BP is set to go to trial against the federal government next week. The feds say they intend to prove that BP was grossly negligent in causing the Deepwater Horizon explosion and subsequent spill. BP says gross negligence is a high bar that it intends to keep prosecutors from clearing. The outcome will determine how many more billions the company ends up paying in fines for releasing millions of gallons of oil into the Gulf of Mexico.

And the proceedings will necessarily slog through all the gory details of the biggest oil spill in U.S. history, forcing those of us who follow the oil industry to suffer flashbacks of the horrific explosion, oil-soaked beaches and those endless hours keeping half an eye on the submarine video feed of oil gushing from the Macondo well.

Please don't do this to us BP. Please settle this case with the feds and the states and everybody else so we don't have to waste hundreds more hours and write dozens of articles recounting BP's safety disasters and engineering screw ups.

BP's tall, earnest, newish CEO Bob Dudley has spent the last two and a half years starting to rebuild BP. He's largely completed the "shrink" part of his shrink-to-grow strategy, selling off $38 billion in assets including BP's half of the Russian venture TNK-BP. He's reorganized divisions, reemphasized safety. He's moving the company forward.

Money, I guess. Because the reason can't possibly be that BP somehow intends to clear its name.

In a statement, BP General Counsel Rupert Bondy says he's been trying to reach a settlement with the DOJ, but has all but given up. “We have always been open to settlements on reasonable terms,” said Bondy. “Faced with demands that are excessive and not based on reality of the merits of the case, we are going to trial.”

It's no surprise that the DOJ is playing hardball. The administration has nothing to lose. A core part of President Obama's base believes that all oil companies are evil, not just the ones that spill crude into the oceans. If the president does end up approving the Keystone XL pipeline, at least he could say he was tough on BP.

“Gross negligence is a very high bar that BP believes cannot be met in this case,” Bondy said in the statement. “This was a tragic accident, resulting from multiple causes and involving multiple parties. We firmly believe we were not grossly negligent.”

Fine. BP wants to prove that it wasn't grossly negligent. But really, for 99% of the population this is a distinction without a difference. No matter whether BP is found grossly negligent or just negligent, it won't change anyone's mind that the accident was BP's fault.

Sure, the gap between "grossly" or "not grossly" is billions of dollars. As we've discussed ad nauseum over the past two years, if the judge in this case finds that BP was grossly negligent in causing the spill, the fines could go as high at $4,300 per barrel spilled. Even if we go with BP's 3.2 million barrel figure rather than the 4.9 million barrels bandied about by Dept. of Justice prosecutors that's upwards of $13 billion.

Bondy assumes that if he can achieve that goal, then the hit to BP's coffers will be well less than the $5 billion widely considered as the low end of Clean Water Act penalties. Federal prosecutors, of course, say they're ready to prove that BP was grossly negligent.

So what are the scenarios here? In the best possible world for BP, it convinces Judge Barbier that it was not grossly negligent. Then it can get out of this mess for something less than $5 billion.

In the worst scenario for BP it is found grossly negligent and is shown no lenience for all the billions it's already spent on cleanup and restoration. It ends up paying another $20 billion.

But no matter what the outcome, BP loses. Its great nightmare gets rehashed day after day in full technicolor. Its engineering snafus are detailed, its engineers called to the stand to rationalize how they could have been so careless. We'll see image after image of dead seabirds. Hear all over again the stories of sea turtles being burned alive. We'll see interviews with the family of the 11 men killed on the Deepwater Horizon. We'll be convinced by scientists that the Corexit oil dispersant sprayed into the plume of escaping oil has proven more toxic to the Gulf ecosystem that the oil itself.

Please BP, settle this case before trial. Pay your fines. Make it go away. Is the difference between $5 billion and whatever a reasonable settlement would be ($10 billion?) worth weeks of negative headlines and embarrassing revelations?

Don't drag your brand, the industry, and the rest of us through your nightmare all over again.